Int'l Union, United Auto., Aerospace, & Agric. Implement Workers of Am. (UAW) v. Honeywell Int'l Inc.

305 F. Supp. 3d 744
CourtDistrict Court, E.D. Michigan
DecidedMarch 29, 2018
DocketCase No. 11–CV–14036
StatusPublished

This text of 305 F. Supp. 3d 744 (Int'l Union, United Auto., Aerospace, & Agric. Implement Workers of Am. (UAW) v. Honeywell Int'l Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Int'l Union, United Auto., Aerospace, & Agric. Implement Workers of Am. (UAW) v. Honeywell Int'l Inc., 305 F. Supp. 3d 744 (E.D. Mich. 2018).

Opinion

*747II. BACKGROUND

For over 50 years, the UAW has represented over 4,700 retired Honeywell (and its predecessors) manufacturing employees in collective bargaining negotiations. The UAW and Defendant have been parties to a series of CBAs that were renegotiated every three or four years. In every CBA executed from the 1965 CBA up to and including the 2003 and 2007 CBAs, the Agreement Regarding Insurance provision included the following language (the "full " provision):

[T]he Company shall contribute the full premium or subscription charge applicable to the coverages of a pensioner (not including a former employee entitled to or receiving a deferred vested pension) and an employee terminating at age 65...

See, e.g., Dkt. No. 49, Ex. 5 (1965 CBA), App'x C, Sect. 5(G), at 12-13; Dkt. No. 49, Ex. 8 (2003-2007 CBA), PgID 1905; Dkt. No. 49, Ex. 9 (2007-2011 CBA), PgID 19-12-13. With respect to the 2011 CBA (which the parties reference), the Court has only been presented with a "Memorandum of Terms of Settlement of the 2011 UAW-Honeywell Master Negotiations." Nothing in that Memorandum addresses-or expressly eliminates-the "full premium" provision.

In 2003, the parties agreed to the inclusion of a new section to Appendix C of the CBA, a "Part VI," a section that also was included in the 2007 CBA (and, apparently, the 2011 CBA). Part VI of the 2003 CBA states:

During the 2003 UAW Honeywell Master Negotiations, the Company and the Union shared a strong concern regarding the protection of retiree health care benefits. In 2003 UAW Honeywell Master Negotiations the Company and Union agree as follows:
• The subject of health care benefits for present and future retirees, their dependents, and surviving spouses, including the limit described below on Company retiree health care contributions, will be a mandatory subject of bargaining for 2007 UAW Honeywell Master Negotiations and for all future UAW Honeywell Master Negotiations.
• The Company will pay the cost of retiree health care coverage during the term of the 2003 UAW Honeywell Master Agreement as described in its Insurance Section. The Company's contribution for health care coverage after 2007 for present and future retirees, their dependents, and surviving spouses covered under the UAW Honeywell Master Agreement shall not be less than (A) the actual amount of the Company's retiree health care contribution in 2007 or (B) the Company actuary's 2003 estimate of the Company's retiree health care contribution in 2007, whichever is greater. As stated above, this limit will be a mandatory subject of bargaining for 2007 UAW Honeywell Master Negotiations and for all future UAW Honeywell Master Negotiations. Notwithstanding such negotiations, the Company's contributions shall not be less than the greater of: (A) the actual amount of the Company's retiree health care contribution in 2007 or (B) the Company actuary's 2003 estimate of the Company's retiree health care contribution in 2007.
• The above limit on Company retiree health care contributions will not apply *748to any year prior to calendar year 2008.
* * * * *
• The provisions of this Agreement concerning Retiree Health Care Costs and the Company's obligation to bargain regarding retiree health care benefits shall be binding upon the successors and assignees of the Company, unless Honeywell chooses to retain such obligations....
• Provided however this Agreement concerning Retiree Health Care Costs and the Company's obligation to bargain regarding retiree health care cost benefits shall not impair any existing legal rights that current retirees may have with respect to their post employment health care benefits.
• The Company and the Union agree to work together to develop possible ways to contain health care costs, including drug costs, that will benefit plan participants and the locations covered under the UAW Honeywell Master Agreement.

[Docket No. 49, Ex. 8, Pg ID 1907]

In connection with the closing of Defendant's Cleveland, Tennessee facility in 2004, Defendant and the UAW entered into a closing agreement that stated: "Honeywell shall incorporate the Cleveland UAW retirees and their dependents, and surviving spouses into its Honeywell UAW Master Agreement, solely for the purpose of negotiating the limit on Company retiree health care contributions." Dkt. No. 49, Ex. 11, at 1. The Cleveland, Tennessee facility's closing agreement included essentially the same language as the Part VI language of the 2003 CBA. Dkt. No. 95, PgId 4385.

In the 2007 CBA, Part VI was identical, except that it provided that "The above limit on Company retiree health care contributions will not apply to any year prior to calendar year 2012." Again, the 2011 CBA (at least in the same form as the 2003 and 2007 CBAs produced during briefing) has not been filed with the Court. The "Memorandum of Terms of Settlement of the 2011 UAW-Honeywell Master Negotiations" does not include any provisions regarding retiree health care contributions for employees who retired prior to January 1, 2016. See, e.g., Dkt. No. 26, Ex. 1 at PgID 944.

On September 15, 2011, Plaintiffs filed the present action in the Eastern District of Michigan, alleging that Defendant's actions constituted anticipatory breach of the CBAs. Defendant notified retirees on September 19, 2011 of its intention to limit its health care contributions starting January 1, 2012. At a November 30, 2011 hearing before the New Jersey District Court, the UAW argued that it "doesn't bargain for retirees" and is not the "designated representative" for retirees. [Docket No. 27, Pg ID 1496, 1498] Ultimately, Defendant did not limit (or "cap") its health care contributions for retirees as of January 1, 2012 but instead waited to do so until January 1, 2014.

On January 30, 2012, Defendant filed its Answer and Counterclaims against Plaintiffs. Defendant's counterclaims alleged fraudulent misrepresentation under Michigan and New Jersey law, negligent misrepresentation under Michigan and New Jersey law, breach of the implied warranty of authority under Michigan and New Jersey law. On March 13, 2012, Defendant amended its Answer and Counterclaim to include a counterclaim for fraudulent concealment. On March 28, 2013, the Court entered an Order denying all of Defendant's counterclaims except the counterclaim for breach of implied warranty of authority.

On October 23, 2013, Defendant advised that it would:

*749begin to cap contributions for those members of the class that (i) retired under the Honeywell-UAW Master CBA on or after May 3, 2003; or (ii) retired under the Cleveland, Tennessee CBA on or after March 13, 2004. This includes surviving spouses and eligible dependents of individuals that retired after those dates. Collections from those class members will commence on January 1, 2014. We will soon be sending out individual notices to those class members to inform them of the healthcare contributions they will owe beginning on January 1, 2014.

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Cite This Page — Counsel Stack

Bluebook (online)
305 F. Supp. 3d 744, Counsel Stack Legal Research, https://law.counselstack.com/opinion/intl-union-united-auto-aerospace-agric-implement-workers-of-am-mied-2018.